Chinese stocks defy Asia gloom ahead of NPC

Mainland financials rally in Hong Kong

Most Asian equities indices headed lower on Thursday, helped by a 1.56% drop in the Nikkei, but Shanghai’s benchmark managed to eke out gains.

Mainland stocks’ resilience in the face of mixed headlines can be explained in part by the upcoming convening of China’s National People’s Congress, which President Xi Jinping is depending on to rubber stamp big changes to the constitution.

“One glance across the Asian equity universe on Thursday is enough to be reminded that what China wants, China often gets,” Mark Cranfield at Bloomberg wrote Thursday. “Onshore equities are defying the weakness in the rest of Asia, even as steel tariffs are close to being imposed. There was at least a strong Caixin PMI report, but persuading domestic investors not to sell ahead of next week’s annual meeting of the National People’s Congress doesn’t hurt either.”

Chinese financials also rallied in Hong Kong, accounting for seven of the top ten performers in the Hang Seng China Enterprises Index: